Annual Report for the Year Ended 30 June 2022 CONTENTS Highlights During The 2022 Financial Year Corporate Directory Review Of Operations Directors’ Report Auditor’s Independance Declaration Consolidated Statement Of Profit Or Loss And Other Comprehensive Income Consolidated Statement Of Financial Position Consolidated Statement Of Changes In Equity Consolidated Statement Of Cash Flows Notes To The Financial Statements Directors’ Declaration Independant Auditor’s Report Additional Information For Listed Public Companies 2 4 5 14 21 22 23 24 25 26 45 46 50 1 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE HIGHLIGHTS DURING THE 2022 FINANCIAL YEAR TOTAL SALES DURING FY2021 Sales FY 2022 A$000’s Sales FY 2021 A$000’s EdenCrete® OptiBlend® Total 1,600 2,549 4,149 1,755 1,528 3,283 Sales % Change -9% +67% +26% HIGHLIGHTS In spite of continued disruption by the COVID pandemic to global markets, coupled with bad weather impacting and restricting concrete pouring on current projects in a number of US States: ◊ 26% increase in total US and Indian revenue for FY22 ◊ 67% increase in OptiBlend® revenue in FY 22 ◊ GDOT projects requiring US$675,000 worth of EdenCrete® under construction or out for tender ◊ Three-year, bulk EdenCrete® supply agreement with Delta Industries in Tennessee and Mississippi ◊ EdenCrete® being sold at 31 Lowe’s locations in Oregon and Colorado and On-line across USA ◊ Sales growth continues in shotcrete and swimming pool markets ◊ Colorado Department of Transportation Interstate 70 Vail Pass trial - positive early assessment ◊ Developed low CO2 , low cost, high fly-ash EdenCrete® Pz concrete mixes for US market ◊ India - Second EdenCrete®Pz order received from Godrej for approx. A$92,000 ◊ Indonesian sales agent appointed for EdenCrete® following successful trials ◊ Expanding Hythane® rollout in India opens opportunities for Eden India COVID-19, Omicron and Bad Weather - Impact on Sales During the year, the Omicron variant impacted EdenCrete® and OptiBlend® sales in USA and India. Extended adverse weather conditions in Georgia also delayed many GDOT projects, reducing US EdenCrete® sales for the year. At 31 July 2022, US$690,000 of EdenCrete® was required for GDOT projects that were in the pipeline and for which contracts are already awarded. After significantly slower sales due to COVID-19 over the past 2 years, Eden is confident of a significant increase in sales across its product range around the world, during the remainder of 2022 and beyond. Market Overview EdenCrete® products - There has been a significant rise over the year in market interest in EdenCrete® including: ◊ the total number of US EdenCrete® projects that are underway or being planned ; ◊ the number of US companies and State DOTs using, trialling or discussing EdenCrete®; ◊ the size and wide range of US projects and applications (including for both infrastructure projects and commercial projects) where EdenCrete® is being used or likely to be used; and ◊ the number of US States where these projects are to be carried out. EdenCrete® products - The following are some of the specific highlights related to EdenCrete® products over the past year: ◊ Eden has successfully developed low CO2, low cost, high fly ash concrete mixes for US market using EdenCrete® Pz (see below for more details) which is generating significant interest. ◊ Positive review of the performance of EdenCrete® concrete at Atlantic Transfer Station after 8 months use; EdenCrete® being considered for at least 1 new project. 2 Annual Report 2022ASX Code: EDE ◊ Shotcrete customers in 5 States (Colorado, Georgia, South Carolina, North Carolina, Tennessee) and trials with potential customers in 2 new States (Mississippi and Texas). ◊ Further repair project planned for Denver International Airport. ◊ Market interest in EdenCrete® is growing rapidly in India, Australia and Indonesia. ◊ In India, a huge market for EdenCrete® products, a second order for approx. $92,000 of EdenCrete®Pz from Godrej Construction has been despatched. Further Indian orders over the next 12 months are expected as Godrej rolls out the range of concrete mixes in four Indian cities. ◊ In Indonesia, also a very large potential market, the recent appointment of an Indonesian sales agent following successful trials with 2 large concrete companies, is likely to generate early sales. ◊ In Australia, a number of important trials for commercial and infrastructure projects were conducted. OptiBlend® - The OptiBlend® dual fuel system is continuing to generate growing interest and demand in India and USA. The following are the OptiBlend® highlights for the past year: ◊ Sales in India (A$1.087 million) during the year were 5% higher than those achieved in 2021 (A$1.033 million). ◊ Restrictions in a number of Indian States imposed on running diesel generators solely on diesel fuel led to two diesel generator manufacturers as well as other diesel generator distributors exploring with Eden India the possibility of selling Eden’s OptiBlend® kits in conjunction with their diesel generators. ◊ This development could significantly increase OptiBlend® sales over the next 12-24 months. Hydrogen and Hythane® - After a long period when there was little market interest in hydrogen and Hythane®, Eden was engaged in separate discussions during the year with both an Indian company and a European company in relation to the separate possible collaborations using Eden’s hydrogen and Hythane® technologies. Carbon Nano Materials – During the year, Eden engaged in discussions with a US company in relation to a possible collaboration of one sort or other in relation to Eden’s proprietary pyrolysis process and the carbon nanotubes produced using this process. These discussions are ongoing. 3 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE CORPORATE DIRECTORY DIRECTORS: Gregory H Solomon LLB (Executive Chairman) Douglas H Solomon BJuris LLB (Hons) (Non-Executive) Lazaros Nikeas B.A. (Non-Executive) Stephen D Dunmead B.Sc., M.Sc., Ph.D. (Non-Executive) COMPANY SECRETARY: Aaron P Gates BCom CA AGIA REGISTERED OFFICE: Level 15 197 St Georges Terrace Perth Western Australia 6000 Tel +61 8 9282 5889 Email: mailroom@edeninnovations.com.au Website: www.edeninnovations.com SOLICITORS: Solomon Brothers Level 15 197 St Georges Terrace Perth WA 6000 AUDITORS: Nexia Perth Audit Services Pty Ltd Level 3 88 William Street Perth WA 6000 SHARE REGISTRY: Advanced Share Registry Services Ltd 110 Stirling Highway Nedlands WA 6009 STOCK EXCHANGE LISTING: ASX Code: EDE (ordinary shares) Quotation has been granted for all the ordinary shares of the company on all Member Exchanges of the Australian Securities Exchange Limited. 4 Annual Report 2022ASX Code: EDE REVIEW OF OPERATIONS EdenCrete® EDENCRETE® SALES – FY22 US EdenCrete® SALES - FY22 (12 months) – A$1.6m (FY21 – A$1.76m) Indian EdenCrete® SALES FY22 – A$78,625 (INR 4,336,700) US EDENCRETE®MARKET Georgia Department of Transportation (GDOT) US$675,000 of EdenCrete® sales in pipeline EdenCrete® sales into the US infrastructure market were slower during the year, in large part due to delays in numerous Georgia Department of Transportation (GDOT) projects that require EdenCrete®, as a result of adverse weather conditions, lack of availability of workers, particularly for night shift work, and shortages of cement. At the end of July 2022, EdenCrete® worth US$675,000 was to be required for GDOT projects that are in the pipeline including projects presently under construction and/or for which the contracts have already been awarded, or for which invitations to tender have been issued. These sales, plus any further projects that are added, are expected to occur progressively over the coming year. Three Year EdenCrete® Supply Agreement with Delta Industries for Tennessee and Mississippi During the year, Eden executed a three-year, bulk EdenCrete® supply agreement with Delta Industries, Inc., (‘Delta”), a Jackson, Mississippi-based company, first established in 1945. Delta operates more than 30 ready-mix plants and sales yards in 4 US States - Mississippi, Alabama, Tennessee and Louisiana, having a combined population of almost 19.6 million people. Mississippi, Alabama and Louisiana are new US EdenCrete® markets. This agreement followed an extensive trialling /evaluation programme conducted by Delta and several of its shotcrete contractors, in which EdenCrete® repeatedly delivered improved pumpability, resulting in improved trucking efficiency and economics. Delta focused on shotcrete because of the wide range of benefits that EdenCrete® has repeatedly delivered in major commercial shotcrete projects in other US states, including improved pumpability. The time normally taken to discharge concrete from a ready- mix truck for shotcrete applications is longer than for other applications. In addition to the other performance benefits delivered by the EdenCrete® mix, the significantly improved pumpability, resulted in Delta being able to shorten the discharge time, enabling it to increase the aggregate daily concrete delivery capability of each truck. Eden supplied and installed three bulk 1,000-gallon (3,785 litres) storage tanks and dispensing equipment, one into each of three selected Delta plants (two in Tennessee and one in Mississippi), that service a substantial portion of Delta’s shotcrete and commercial/ industrial markets. These three plants are all in reasonable proximity to each other, enabling cost effective delivery by road tanker. The initial orders from Delta, for an aggregate of US$75,000 (A$105,927) for the 3,000 gallons of EdenCrete® required to fill the three tanks was supplied by road tanker from Colorado after the end of the year (see Figure 1). The agreement, which expires in May 2025, also includes two further options of renewal, each for another two years. After the first 18 months, either party may terminate the agreement by giving 90 days’ notice to the other party. The agreement also provides that the initial price of EdenCrete® of US$25/gallon is fixed for the first 12 months. In addition to using EdenCrete® in shotcrete applications, Delta has advised that it also intends to trial EdenCrete® in other concrete mixes for use in a wider range of different applications, including where fresh property benefits, hardened property benefits, and improved durability and sustainability are required. Figure 1. Initial EdenCrete® order to Delta Industries being delivered. This long-term, bulk EdenCrete® supply agreement with Delta, a long-established and regionally significant US ready-mix concrete supplier operating in four US states, further expands the US EdenCrete® market footprint. EdenCrete® now being sold in 31 selected Lowe’s stores in Oregon and Colorado, and On-line across USA During the year EdenCrete® was first offered, in Oregon, for sale at 14 selected stores of Lowe’s, one of the largest home improvement retailers in the world. The product is also available on-line, at Lowes.com for US customers across the US, and on-line sales have commenced. 5 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE REVIEW OF OPERATIONS (Continued) Encouragingly, since the end of the year, Lowe’s increased the number of stores in which it is selling EdenCrete® to now also include 17 selected Lowe’s stores in Colorado, bringing to 31 the aggregate number of Lowe’s stores in the US where EdenCrete® is currently on sale. Lowe’s has a total of over 2,000 stores in the USA. This important marketing initiative is a first for EdenCrete®, being available to US retail customers, opening a new customer base and also promoting broader public awareness of EdenCrete® and the benefits that it delivers. Designed to deliver the equivalent benefits of several concrete admixtures in one, EdenCrete® offers improved fresh properties, abrasion resistance, reduced cracking, reduced permeability, lower maintenance and overall offering more sustainable, longer-lasting construction. As such, the product is well targeted towards the broad retail market, as well as smaller builders and contractors, looking for a range of performance improvements. Swimming Pools – Sales growth continues Following successful trials in February 2022, Eden started to receive a growing number of orders from contractors in 7 states (Colorado, Georgia, North Carolina, Florida, Texas, New Mexico and California), for use in exposed aggregate pool mixes for finishing swimming pools (see Figure 2). In March 2022, Eden received its first large order, worth approximately A$ 416,050 (US$311,040), sufficient for finishing for approximately 5,000 swimming pools, to be supplied progressively over a 12 month period. Figure 2. A typical US exposed aggregate, swimming pool finishing mix being applied. 6 This use of EdenCrete® not only permitted a 20% reduction in the amount of cement required in the concrete finishing mix, but also delivered the following benefits: ◊ Improved pumping ◊ Improved placing ◊ Improved finishing ◊ Reduced waste in the finishing process ◊ Tighter pebble packing ◊ Easier to clean out pump and hoses after job completion. The strong and rapid market uptake is a firm endorsement of the benefits delivered by the EdenCrete®, confirming the potential importance of the total US EdenCrete® swimming pool market. This new application expands the existing US EdenCrete® shotcrete market used in the construction of pool shells, regardless of the finish used. EdenCrete® is already in regular use in shotcrete used for concrete swimming pool shell construction in three US states, Colorado, Georgia and North Carolina, where sales also rose sharply over the past year. The swimming pool markets represent major EdenCrete® markets in the USA. Aqua Magazine, a leading US publication focused on swimming pools, ran an article on EdenCrete® in its June edition. The positive market response to this article, and a subsequent advertisement run by Eden in the July edition, has generated over 12 new enquiries for EdenCrete® products for use in shotcrete applications and/or swimming pool construction and finishing. Low CO2, low cost, high-fly ash concrete mixes developed for US Market with EdenCrete® Pz Eden US has recently completed the development, at its Colorado laboratory, of a range of low-CO2 , high- fly ash content concrete mixes that incorporate either EdenCrete® Pz or Pz7. This programme, designed to help customers optimize the dosage of EdenCrete® products in their mix designs for cost-efficient strength gain optimization, has been very successful. A range of new concrete mixes were developed, using several brands and types of cements, but with either 20% or 40% fly ash being substituted for an equivalent quantity of cement powder and with a low dosage of EdenCrete® Pz. The performance of these new mixes was highly encouraging when compared with the performance of same mixes without 20% or 40% fly ash. Additionally, material net cost savings (up to US$6 per cubic yard of concrete) were also achieved, without reducing the strength of the concrete. Annual Report 2022ASX Code: EDE This project has attracted considerable interest, and Eden is engaged in discussions with potential customers in a number of States of the US, including a reasonable number of large ready mix concrete suppliers. When these performance benefits and cost savings are coupled with the materially reduced Greenhouse Gas footprint delivered benefit as a result of using the far lower CO2 fly ash, Eden US anticipates that this programme alone will deliver very significant market growth and product sales over the coming years. Waste transfer stations The first waste transfer station project using EdenCrete® in the concrete tipping slab, that is exposed to extreme wear, was built in Savannah, Georgia for Atlantic Waste Services in early 2021. The project came after a review of the increased abrasion resistance and reduced permeability that EdenCrete® delivers to concrete. Dosed at the rate 4 gallons/cubic yard of concrete, the EdenCrete® delivered a cost- effective alternative to a more expensive, epoxy coating treatment that had previously been used in other waste transfer stations, and which it replaced. After 8 months of use under very harsh, acidic and abrasive conditions, a positive review of the performance of the EdenCrete® enhanced concrete at Atlantic Waste Transfer Station has resulted in EdenCrete® now being considered for inclusion in similar concrete for at least one proposed new transfer station project. Shotcrete Market Growth Sales of EdenCrete® for shotcrete applications continue to grow, in part as a result of a positive impact following the release of Eden’s shotcrete promotional video in June 2021. New shotcrete customers in 4 US States - North Carolina, Tennessee, Mississippi and Georgia – were added to the already existing shotcrete customer base, that now extends across 5 States (Colorado, Georgia, South Carolina, North Carolina and Tennessee), with potential customers are also planned in Mississippi and Texas. Airports - Further EdenCrete® project planned for Denver International Airport. Following earlier success in a number of repair projects in the concrete apron outside the United Airlines maintenance hangar in September 2021, Eden has been advised that further repair projects that will use EdenCrete® are scheduled for the coming months. Florida DOT During the year, Florida Department of Transportation (FDOT) added EdenCrete® and EdenCrete®Pz to its approved admixture list. EdenCrete® is now approved for DOT use in 22 States (EdenCrete®Pz in 17 States), being: Alabama, Alaska, Arkansas, California, Colorado, Florida, Georgia, Kansas, Kentucky, Louisiana, Maine, Massachusetts, Mississippi, North Carolina, Oklahoma, Oregon, South Carolina, Tennessee, Texas, Vermont, Virginia and West Virginia; and (see Figure 3). Figure 3. Current Status of US DOT Approvals of EdenCrete® Products These 22 States represent approximately: ◊ 55% of the total US population; ◊ 75,480 bridges* that are structurally deficient or functionally obsolete; ◊ 52% of the total number of such bridges in the USA*; and ◊ 55% of the total US land area. With its significantly expanding US sales footprint, the ongoing DOT EdenCrete® trials (particularly for bridges) in various States, plus the approvals for DOT use in 22 States, EdenCrete® is very well placed to participate in the expected significant market growth from an additional US$110 million under the recently announced US Federal infrastructure programme. This Federal funding is in addition to US$905 million of US Federal funding awarded to 24 projects in July 2021 under the Infrastructure for Rebuilding America programme. 7 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE REVIEW OF OPERATIONS (Continued) Colorado Department of Transportation - I-70 Vail Pass trial - positive assessment after first 12 months As announced by Eden on 15 June 2021, in early May 2021, following several years of planning, design, and preparation, the Colorado Department of Transportation (CDOT) completed the installation of a major concrete paving trial in Summit County. CDOT, jointly with Peak Materials, the American Concrete Pavement Association, Eden Innovations, and IHC Scott executed the trial, to evaluate the long-term performance of three alternative concrete mix designs at ~10,000 feet (~3050 metres) elevation, to compare the performance over a 3-year period of a standard concrete mix, followed by an EdenCrete® concrete mix and also a silica fume concrete mix. After the first year of use (out of the intended 3 year trial), which included the entire 2021-22 winter, the three pavement sections are already reflecting the impacts of nature, de-icing chemicals and the heavy traffic use on a major Interstate Highway. In May 2022, 12 months after the trial started, Eden conducted the first visual evaluation of the performance across five parameters. Table 1 summarizes the observed performance, after the first year, of each of the three pavement sections, photos of which are also shown in Figures 4-6 below. Pavement Scaling/Abrasion Pop Outs/Pitting Cracking Joint Rot Rutting Reference EdenCrete® Silica Fume Table 1 Yes Yes Yes Yes No Yes Yes No Yes Yes No Yes Yes No No This demonstrated, superior performance delivered by the EdenCrete® enhanced concrete in the first 12 months of the 3-year trial in such harsh service conditions is highly encouraging. Based on its performance in other longer projects (such as GDOT road projects), the EdenCrete® concrete is considered likely to continue to outperform the other slabs over the full 3 years. This would be of great assistance to Eden in its efforts to extend the existing EdenCrete® market footprint further into the highways and bridges through state and federal US Departments of Transportation, and into the broader US infrastructure market. Figure 4 Mid-Section- Reference Slab -12 months Severe Surface Damage, Joint Rot, Pitting, Pop Outs Figure 5 Mid-Section -Silica Fume Slab - 12 months Surface worn off, Scaling, Pitting, Aggregate Pop Outs 8 Annual Report 2022ASX Code: EDE Figure 6 Mid-Section- EdenCrete® Slab – 12 months Concrete surface partially worn off, No Scaling, No Surface Damage, No Pitting or Aggregate Pop Outs, No Rutting, No Joint Rot Structural Concrete Insulated Panel (“SCIP”) Project The first and largest SCIP construction project built in Houston, Texas, was started in 2021. The 4-storey single-family residential building’s panels were erected and joined to create interior and exterior walls, ceilings, and floors (see Figure 7) . The General Contractor batched and shot the exterior and interior shotcrete shell to an approximate thickness of 1.5 inches (3.8cm) on each side. This project required a total of 350 cubic yards (268 cubic metres) of shotcrete, and used only US$3,062 (approx. A$4,264) worth of EdenCrete®, delivering a very cost- effective outcome. The use of EdenCrete® was specified by the general contractor at 1/4 gallon/cubic yard (approx. 1.2 litres/ cubic metre) of concrete for this ongoing project. EdenCrete® was used to take advantage of the improved rheology of the shotcrete mix, allowing the mix, which pumps and finishes exceptionally well, to be easily placed, filling and fully encapsulating the 2-inch wire mesh opening.(see Figure 8) . This SCIP structure delivered a non-combustible building that does not require a fire sprinkler system. Figure 8. Shotcrete mix with EdenCrete® filling and fully encapsulating the wire mesh INTERNATIONAL EDENCRETE® MARKET INDIA - GODREJ CONSTRUCTION – SECOND SALE - A$92,000 Eden Innovations (India) Pvt Limited, the wholly owned subsidiary of Eden Innovations Ltd made its second sale to Godrej Construction, the construction division of Godrej & Boyce Manufacturing Co. Ltd (“Godrej”), for approximately A$92,000 worth of EdenCrete®Pz for use in its ready-mix concrete operation in several cities (including Mumbai and Pune) in the state of Maharashtra. The sale was in August 2020. This second order from Godrej Construction, which is six times larger than the first order, followed the successful completion of a significant, 12 months testing and development programme conducted by Godrej Construction using standard concrete mixes from several cities where it operates, that, with the addition of only modest dosages of EdenCrete® Pz, were able to incorporate far higher percentages of fly ash in place of ordinary Portland cement. As a result, these new concrete mixes were able to deliver stronger, cheaper concrete with far lower CO2 footprints than had been possible without the addition of EdenCrete®Pz. This second Godrej Construction sale is a highly significant development in the commercialization of EdenCrete® products because: ◊ Not only is it a significant order but it is the first repeat order from outside the USA to be received for any EdenCrete® product; Figure 7. 4-storey SCIP residential home in Houston under construction and including EdenCrete® 9 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE REVIEW OF OPERATIONS (Continued) for EdenCrete® products. EdenCrete®Pz is the product being used in India, enabling concrete contractors to reduce the amount of more expensive Portland cement used in their concrete mixes, and replace it with Indian fly ash, a readily available waste product from the many local coal fired power stations, that is not only a far cheaper cementitious material than Portland cement, but one that also has a greatly reduced Greenhouse Gas footprint. The level of interest in India in both the economic and environmental benefits of more durable concrete is evidenced in a recent Maharashtra Government Invitation to Tender to supply 40 MPa strength concrete for the construction of two major Indian highway projects, that lists Nano Carbon Technology as one of the Key Product Specifications for enhanced serviceability of concrete pavement for the projects. India is pushing ahead with a staggeringly large urbanisation and infrastructure programme that will take decades to complete, and represents a huge target market for EdenCrete®. With a very strong relationship with Godrej, one of India’s most respected companies, Eden India, which has operated since 2007 and been increasingly profitable for the past three years, is extremely well placed to participate in this extraordinarily exciting journey that has the potential to grow very rapidly. AUSTRALIA – EDENCRETE® MARKETING PROGRESS Parchem Construction Supplies Pty Ltd (‘Parchem”), the EdenCrete® products distributor in Australia and New Zealand, has been making progress in the marketing of the EdenCrete® range in both Australia and New Zealand, and a number of trials with potentially significant customers have been undertaken. The following is a summary of broad progress made during the year by Parchem: ◊ A trial was undertaken in mid-December 2021, at a sugar mill in North Queensland. Sugar, similar to chlorides, is highly corrosive to concrete. Due to the corrosive environment of this operation, ongoing maintenance, repair and sometimes replacement, is constantly required on the concrete slabs. EdenCrete® was identified to be used in this repair trial, for its strength and durability, with an objective of extending the service life of the repaired slab. The slabs will be monitored over time to determine their durability in this harsh environment. ◊ The successful testing and development programme undertaken by Godrej Construction occurred during a year when India was greatly impacted by several major challenges including COVID 19 lockdown restrictions, and opens the way for Godrej to roll these mixes out in several fast-growing cities in Maharashtra with a combined population of over 50 million people; ◊ India is estimated to currently produce around 150 million tonnes of fly ash per year and this is anticipated to rise to around 500 million tonnes p.a. within the next 5-10 years as scheduled new coal fired power plants come on line; ◊ India has a population of nearly 1.4 billion people, of whom approximately 800 million live in rural areas; ◊ India announced in 2019 a US$1.2 trillion infrastructure programme, that, along with the rapidly increasing urbanization, will require very large quantities of concrete; and ◊ The addition of small dosages of EdenCretePz to concrete mixes made with less Indian cement and a far higher percentage of Indian fly ash has led to a number of new concrete mixes, covering a range of performance standards, being developed that all deliver stronger and cheaper concrete, and with each mix having a far lower CO2 footprint than had previously been possible. After extended delays of over four months (due to global container freight and shipping delays), the first major order received from Godrej Construction in late 2021 for A$92,000 worth of EdenCrete® Pz (over half of a container load) finally arrived in India in late April 2022, enabling Godrej Construction to start significantly expanding its Indian market foot print for EdenCrete® enhanced concrete. Following receipt of this shipment, Eden’s chief scientist flew to India and assisted the Godrej Construction team, with whom Eden has been collaborating since 2019, in expanding the range of EdenCrete® Pz enhanced concrete mixes suitable for use in Godrej’s batching plants in two additional large Indian cities (bringing the total to four such cities). Godrej is part of a very highly regarded Indian group that was established in 1897, and now sells a wide range of products across India and also into 80 other countries. It is has offices in 20 major Indian cities and is currently expanding its concrete operations. ◊ India with a population of nearly 1.4 billion people, with approximately 800 million living in small rural communities, and of whom many wish to move to towns and cities, offers an enormous potential market 10 Annual Report 2022ASX Code: EDE ◊ Parchem’s first container load of EdenCrete® stock – 16 pallets -arrived into Australia in June 2022 (after an extended delay due to well publicised international container and shipping problems). ◊ Perth Wake Park used EdenCrete® at 4L/m3 for replacement concrete paths, to reduce the permeability, and increase the durability for longer lasting concrete (see Figure 9). ◊ A speciality pavement tile manufacturer continues to use EdenCrete®, purchasing ~180 litres per month. Figure 9 Concrete pavement (including EdenCrete®) at Perth Wake Park ◊ EdenCrete® was recently trialled in a laboratory with use of recycled aggregates to determine the ability to gain MPa strength similar to a control mix with standard quarry aggregate. At a dose of only 2.5L/m3, the CNT mix with 100% recycled aggregate, achieved 97% of the control mix strength that had NO recycled aggregate and the CNT achieved a 10% increase in MPa strength vs. a control mix of the same 100% recycled aggregate. ◊ After trialling the EdenCrete® mix a year ago, and achieving 20MPa over the control mix at 3, 7 and 28 days, a port in QLD has specified 5L/m3 in precast concrete elements for a boat ramp – 45-50m3 of concrete in total, a project that commences in September 2022. ◊ SmartCrete CRC – Parchem has partnered with SmartCrete CRC and Curtin University Corrosion Centre in Perth, on a 3 year Project that will see EdenCrete® used in concrete mixes, in simulated and actual marine environments, for reportable performance in strength, reduced permeability and overall durability of concrete assets in the most corrosive environment. ◊ Technical presentations to Engineers, Asset owners and Industry partners this year included: ◊ Concrete Institute of Australia in Perth, and ◊ Water Industry Operators Association of Australia (WIOA) Victoria. EdenCrete® has AS/NZS 4020:2018 standards certification -products for use in contact with drinking water i.e. concrete tanks. INDONESIA – SALES AGENT APPOINTED AFTER SUCCESSFUL TRIALS OF HIGH-FLY ASH CONCRETE Following successful trials during the year of EdenCrete® Pz in various low CO2, low cost, high-fly ash concrete mixes with an Indonesian concrete company that was introduced by Ai Building Indonesia (“Ai Building”), Ai Building was appointed as a commission sales agent for the EdenCrete® range of products for Indonesia. Following the appointment, Eden’s chief scientist flew to Indonesia to participate in concrete batching trials with a number of other large Indonesian concrete producers, focused on developing high strength, low cost and CO2 footprint concrete mixes incorporating high percentages of fly ash, in substitution for similar percentages of Ordinary Portland Cement (OPC) that would otherwise be used in the concrete mixes. As had been the case with a number of earlier Indonesian trials, these recent trials, that are still on-going, are producing highly encouraging results, including a number where small, low cost dosages of EdenCrete® Pz, are delivering strength increases of up to, and even beyond, 25%, in low Portland cement/ high fly-ash content concrete mixes, opening up the prospect of a very exciting Indonesian EdenCrete® market. In consequence, Eden is confident that sales of EdenCrete products to Indonesian customers are likely to commence in the coming months. Indonesia, with a population of over 270 million people, large domestic coal deposits and, currently, over 40 GW of decentralised coal fired power generating capacity (with a correspondingly high annual fly ash production), has many similarities to India, including a huge projected growth in both urbanisation and infrastructure improvement. As such it is currently considered to be Eden’s second (after India) most important international market for EdenCrete® outside the USA. 11 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE OPTIBLEND® OptiBlend® Sales for the Year (FY22) SALES FY 22 (A$000s) SALES FY 21 (A$000s) % Change USA INDIA TOTAL For FY 1,462 1,087 2,549 495 1,033 1,528 +196% +5% +67% Indonesia, like India, is a major cement manufacturing country with a large concrete industry, and which also has many coal -fired power stations and a significant ongoing supply of fly ash. Similarly, to India, Indonesia is expected to develop into a major market for EdenCrete® products, and in particular for EdenCrete® Pz for use in low CO2, low cost, high- fly ash concrete mixes. OPTIBLEND® SALES SUMMARY Total Sales - Q4 Fy 22 – A$0.57m ( Q4 Fy21 – A$0.64m ) Total Sales - Fy 22 – A$2.55m (Fy21 – A$1.53m) OptiBlend® Sales in USA and India expected to grow, due to various market factors. US OptiBlend® Market Outlook In the US, the desire to significantly extend the back- up capacity of the installed diesel fuel storage, through the displacement with natural gas of up to 70% of the diesel fuel being consumed, is driving sales growth.The US OptiBlend® market is expected to continue to grow at a modest pace, with the most growth anticipated to be achieved in the South-East, South-West and Mid-West regions of the US. INDIAN OPTIBLEND® MARKET Indian OptiBlend® Sales Q4 FY 22 – A$0.41m Indian OptiBlend® Sales FY 22 – A$1.09m (FY21 – A$1.03m) Indian OptiBlend® Market Outlook Indian OptiBlend® sales for the year were lower than expected due to long delays in the supply of a key component that includes a computer micro-chip that delayed delivery of the required component for a number of months. Using natural gas to replace a large percentage of the diesel fuel in diesel powered generators, results in lower operating temperatures and lower levels of 12 environmentally hazardous emissions such as particulates and NOx. This is of extreme importance in India where the Supreme Court has prohibited the use, in Greater Delhi (with a combined population of over 40 million people), of diesel generators running on 100% diesel fuel for a significant portion of the year, in an effort to try to reduce the extremely high levels of toxic air pollution which are regularly experienced. This situation is expected to continue to drive growth in OptiBlend® sales in India for the foreseeable future. Whilst the reliability of the power grid is improving, people are still concerned by the prospect of having to face being without power from time to time, particularly in the extreme summer heat that is regularly experienced. As a result, subject to availability of all its required components, Eden India expects to achieve potentially significant growth in it OptiBlend® sales over the next year. Carbon Nanotubes During the year discussions were held with a company that produces and markets a range of nano-carbon particles and products, and wished to explore the potential of using Eden’s carbon nanotubes in some of its products. Following the discussions, trials were undertaken by the company with Eden’s carbon nanotubes and, at the date of this Report, those trials are still continuing. EdenPlast® During the year, the Japanese plastics company that has been trialling EdenPlast® over the past 18 months, conducted further trials. An additional master batch of EdenPlast® CNT-enriched polymers was also prepared for further testing in Japan. Eden is hopeful that a positive outcome from the Japanese trials will lead to an initial sale and the establishment of a strong commercial EdenPlast® market. Annual Report 2022ASX Code: EDE CORPORATE Eden completed two rights issues and a placement raising a total of A$6.93 million (before costs). Eden US, supported by Eden Australia, finalised a transaction to replace the two earlier secured loans (totalling US$3.365 million) and secured against Eden’s US real estate assets, with a new secured loan from iBorrow REIT LP of US$6.475 million, which represents less than 55% of the recently re-appraised values of Eden’s three US properties. The new loan carries an interest rate of 9.75% p.a. This new loan was completed, and the existing loans repaid during August 2022. The new loan is for 11 months (to 29 June 2023) and with an option extension to 29 June 2024. After repaying the two existing secured loans, payment of all expenses and commissions, and establishing reserves to cover future interest payments, real estate taxes and insurance, approximately US$1.7 million (A$2.45million) of additional working capital for Eden was generated by this transaction, supplementing the revenue stream being received from increasing product sales. Eden also has its 65-acre industrial property in Augusta, Georgia, on the market for sale. Hydrogen Interest in Eden’s Hydrogen / Hythane® products and technologies During the year, Eden US updated its proprietary Hythane® blender (for blending hydrogen and natural gas in specific ratios), which was developed more than 12 years ago, and now needed to have some of its original components replaced with improved and currently available components. This followed Eden India having received a number of enquiries in relation to supplying blenders for use in the Indian Hythane market, and the recent upgrade of Eden’s Hythane® blender will enable it to be readily supplied by Eden India into the Indian market as required. Hythane, a mixture that in India is specified as 18% hydrogen and 82% natural gas (by volume), is currently being rolled out in Greater Delhi where 7,000 natural gas buses are being converted to operate on Hythane, as a result of a ruling by the Indian Supreme Court requiring natural gas buses to only operate on fuels that also include hydrogen, to assist in improving the air quality in Greater Delhi. Trials and similar projects in other parts of India are also being planned. Additionally, it is understood that the possibility of adding hydrogen into natural gas pipelines in India is also being considered as a means of both reducing air pollution and Greenhouse Gas emissions. Eden India is planning to manufacture in India all its future blender Hythane® requirements. Interestingly, a similar hydrogen-enriched natural gas project is also reportedly being planned in the north east of the USA. Hydrogen – European interest During the year, further discussions took place with a European chemical company with which Eden, in 2019, conducted joint laboratory trials, in relation to a possible collaboration involving the use of Eden’s proprietary pyrolysis process for production of both turquoise hydrogen and carbon nanotubes. These recent discussions are ongoing. In addition to its existing EdenCrete® products, Eden’s long-term strategic plan is to develop global markets for a range of other products (including EdenPlast®) that will collectively use sufficient CNT to support the development of a commercial scale, turquoise hydrogen programme based upon Eden’s efficient, low cost, patented, commercialised and proprietary methane pyrolysis process. 13 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE DIRECTORS’ REPORT Your directors present their report on the Company and its controlled entities (the Group) for the financial year ended 30 June 2022. Significant Changes in State of Affairs There have been no significant changes in the state of affairs that occurred during the financial year. After Balance Date Events On 26 July 2022 6,400,000 fully paid ordinary shares were issued to Mr Stephen Dunmead and Mr Lazaros Nikeas pursuant to resolutions passed at the general meeting held on 2 July 2019. On 2 August 2022 the board of directors resolved to sell the 65-acre industrial property in Augusta, Georgia. On 10 August 2022 Eden US, support by Eden Australia, finalised a transaction replacing the two earlier secured loans (totalling US$3.365 million) secured against Eden’s US real estate assets, with a new secured loan from iBorrow REIT LP of US$6.475 million, which represents less than 55% of the recently re-appraised values of Eden’s three US properties. The new loan carries an interest rate of 9.75% p.a. The new loan is for 11 months (to 29 June 2023) and with an extension option to 29 June 2024. After repaying the two existing secured loans, payment of all expenses and commissions, and establishing reserves to cover future interest payments, real estate taxes and insurance, approximately US$1.7 million (A$2.45million) of additional working capital for Eden was generated by this transaction, supplementing the revenue stream being received from increasing product sales. On 12 August 2022 the Company issued 94,375,000 EDE shares and 94,375,000 free attaching EDEOC options to investors at $0.008 per share raising $755,000 before costs. Brokers were paid a 6% placement fee and received 7,000,000 EDEOC options. No other matters or circumstances have arisen since the end of the financial year which significantly affected or may significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in future financial years. Future Developments, Prospects and Business Strategies The Group proposes to continue developing and marketing its technologies, including EdenCrete® and OptiBlend® as detailed in the Review of Operations. Environmental Issues The Group is subject to environmental regulation and complies fully with all requirements. Directors The names of directors in office at any time during or since the end of the year are: Gregory H Solomon Stephen D Dunmead Douglas H Solomon Lazaros Nikeas Directors have been in office since the start of the financial year to the date of this report. Company Secretary The following person held the position of company secretary during and at the end of the financial year: Mr Aaron P Gates has worked for Eden Innovations Ltd for the past 14 years. He is a Chartered Accountant and Chartered Secretary. He has completed a Bachelor of Commerce (Curtin University) with majors in accounting and business law and completed a Diploma of Corporate Governance. Prior to joining Eden he worked in public practice in audit and corporate finance roles. Principal Activities ◊ Eden Innovations Ltd produces and sells a high performance concrete admixture, EdenCrete® and retrofit dual fuel technology, OptiBlend®, developed for diesel generator sets. There were no significant changes in the nature of the consolidated Group’s principal activities during the financial year. Operating Results The consolidated loss of the Group after providing for income tax amounted to $6,646,577 (2021: $5,758,759). Dividends Paid or Recommended No dividends were paid or declared for payment during the year. Review of Operations A review of the operations of the Group during the year ended 30 June 2022 is set out in the Review of Operations on Page 5. Financial Position The net assets of the consolidated group have increased from $18,140,732 at 30 June 2021 to $19,485,079 at 30 June 2022. The group’s working deficit, being current assets less current liabilities, has increased from ($1,085,283) at 30 June 2021 to ($1,159,248) at 30 June 2022. 14 Annual Report 2022ASX Code: EDE Information on Directors Gregory H Solomon Executive Chairman Qualifications Experience Interest in Shares and Options LLB Appointed Executive Chairman in 2004. A qualified lawyer with more than 30 years’ Australian and international experience in a wide range of areas including commercial negotiation and corporate law. Following 15 years’ experience as a director on a number of ASX listed companies, for the past 15 years in his role as Executive Chairman he has been responsible for initiating and managing the entire business development of all companies in the Group since its incorporation. 55,293,891 Ordinary Shares, 1,890,392 EDEO Options, 3,071,884 EDEOC Options Directorships held in other listed entities Tasman Resources Limited (ASX:TAS) Conico Limited (ASX:CNJ) Douglas H Solomon Non-Executive Director Qualifications Experience Interest in Shares and Options BJuris LLB (Hons) Board member since May 2004. A Barrister and Solicitor with more than 30 years’ experience in the areas of mining, corporate, commercial and property law. He is a partner in the legal firm, Solomon Brothers. 47,465,292 Ordinary Shares, 1,622,747 EDEO Options, 2,636,962 EDEOC Options Directorships held in other listed entities Tasman Resources Limited (ASX:TAS) Conico Limited (ASX:CNJ) Lazaros Nikeas Qualifications Experience Non-Executive Director B.A. Board member since May 2018. Mr Nikeas is an experienced investment and private equity professional with over 17 years of US finance experience. Mr Nikeas is currently a Principal investment manager for Weston Energy LLC, a portfolio company of New York private equity group, Yorktown Partners LLC. Prior to this, he was Lead Partner and Principal of Traxys Capital Partners, a private equity vehicle focused on mining, chemicals and industrial investments in partnership with The Carlyle Group. Before moving into private equity, he served as the Head of Corporate Finance Advisory for Materials, Mining and Chemicals for North America for BNP Paribas for five years. Other investment banking roles included Partner in Mergers & Acquisitions Advisory at Hill Street Capital for eight years and as a Corporate Finance Analyst at Morgan Stanley, where he began his career. Altogether, he has advised on over US$25 billion of mergers and acquisitions transactions. Interest in Shares and Options 7,497,334 Ordinary Shares Directorships held in other listed entities - 15 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE DIRECTORS’ REPORT (Continued) Stephen D Dunmead Non-Executive Director Qualifications Experience B.Sc., M.Sc., Ph.D. Board member since May 2018. Based in the US, Dr Dunmead is a global business executive with over 30 years of strong operational leadership experience in the US based global materials industry. He served as Chief Operating Officer at SWM International (NYSE: SWM) in Georgia where he was responsible for over 3,000 employees across 20 sites of the company’s global operations in North and South America, Europe and Asia, accounting for US$0.8 billion of revenue and US$180 million in EBITDA. At SWM International he led the business into the high growth and high margin filtration and medical sectors. Prior to SWM International, Dr Dunmead spent over 15 years at OM Group (NYSE: OMG) in Ohio where he was a member of the Corporate Executive Team and had responsibility for six businesses with more than 6,500 employees across 32 sites in North America, Europe, Asia and Africa. Together, these businesses represented US$1.5 billion in revenue and US$255 million in EBITDA. Dr Dunmead holds 25 US Patents on Advanced Materials and Specialty Chemicals. Interest in Shares and Options 8,497,334 Ordinary Shares Directorships held in other listed entities - REMUNERATION REPORT (AUDITED) This report details the nature and amount of remuneration for each director of Eden Innovations Ltd, and for the executives receiving the highest remuneration. Remuneration policy The remuneration policy of Eden Innovations Ltd has been designed to align director and executive objectives with shareholder and business objectives by providing a fixed remuneration component and offering specific long-term incentives based on key performance areas affecting the consolidated Group’s financial results. The Board of Eden Innovations Ltd believes the remuneration policy to be appropriate and effective in its ability to attract and retain the best executives and directors to run and manage the consolidated Group, as well as create goal congruence between directors, executives and shareholders. The Board’s policy for determining the nature and amount of remuneration for Board members and senior executives of the economic entity is as follows: ◊ Executives receive a base salary (which is based on factors such as length of service and experience), superannuation (401k match), fringe benefits and share performance rights. Executives are also entitled to participate in the employee share and option arrangements. All remuneration paid to directors and executives is valued at the cost to the Company and expensed. Options are valued using the Black-Scholes methodology. The Group does not have a policy on directors hedging their shares. The maximum aggregate amount of fees that can be paid to non-executive directors is subject to approval by shareholders at the Annual General Meeting. Fees for non-executive directors are not linked to the performance of the consolidated Group. However, to align directors’ interests with shareholder interests, the directors are encouraged to hold shares in the Company. Performance-based remuneration No performance based remuneration was paid during the year. Key Management Personnel Remuneration Policy The Board’s policy for determining the nature and amount of remuneration of management for the Group is as follows: The remuneration structure for key management personnel is based on a number of factors, including length of service, particular experience of the individual concerned, and overall performance of the Company. The contracts for service between the Company and key management personnel are on a continuing basis, the terms of which are not expected to change in the immediate future. Upon retirement key management personnel are paid employee benefit entitlements accrued to date of retirement. Any ESOP options not exercised before or on the date of termination lapse. 16 Annual Report 2022ASX Code: EDE Names and positions held of economic and parent entity key management personnel in office at any time during the financial year are: Key Management Person Gregory H Solomon Position Executive Chairman Douglas H Solomon Non-Executive Director Lazaros Nikeas Non-Executive Director Stephen D Dunmead Non-Executive Director Don Grantham Jr Innovations LLC Roger Marmaro Aaron P Gates President & CEO - Eden President – Sales – Eden Innovations LLC (left November 2020) Company Secretary / Chief Financial Officer Meetings of Directors During the financial year, 6 meetings of directors were held. Attendances by each director during the year were as follows: Number eligible to attend Number attended Gregory H Solomon Douglas H Solomon Lazaros Nikeas Stephen D Dunmead 6 6 6 6 6 6 4 6 17 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE DIRECTORS’ REPORT (Continued) Key Management Key Management Person Short-term Benefits Post- Employment Benefits Other Long Term Benefits Termination Benefits Share- based Payments Total Salary and Fees Non-cash benefit Other Super- annuation Other Other Equity Options Performance Rights $ $ $ $ $ $ $ $ $ $ 2022 Gregory Solomon 300,000 Douglas Solomon Lazaros Nikeas Stephen Dunmead(a) 54,000 54,000 54,000 - - - - Don Grantham Jr(c) 420,982 16,834 Roger Marmaro(d) Aaron Gates - (b) - - 882,982 16,834 2021 Gregory Solomon 300,000 Douglas Solomon Lazaros Nikeas Stephen Dunmead(a) 54,000 54,000 54,000 - - - - Don Grantham Jr(c) 401,736 20,677 Roger Marmaro(d) 171,866 7,737 Aaron Gates (b) - 1,035,602 28,414 - - - - - - - - - - - - - - - 28,500 5,130 - - 25,356 - - 58,986 28,500 5,130 - - 21,607 10,312 - 65,549 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 32,000 32,000 182,567 - 26,760 273,327 - - 32,000 32,000 167,216 - - 231,216 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 328,500 59,130 86,000 86,000 645,739 - 26,760 1,232,129 328,500 59,130 86,000 86,000 611,236 189,915 1,353 1,353 1,353 1,362,134 Other transactions with key management personnel Management fees of $300,000 were charged during the year and $75,000 was payable to Princebrook Pty Ltd, a company in which Mr GH Solomon and Mr DH Solomon have an interest. Legal fees of $32,956, based on normal market rates, were paid to Solomon Brothers, a firm in which Mr GH Solomon and Mr DH Solomon are partners. ◊ (a) Mr Stephen Dunmead provided short-term consulting services to the Group during the period. ◊ (b) This officer is provided by Princebrook Pty Ltd (a company in which Mr Gregory Solomon and Mr Douglas Solomon have an interest) under the Management Services Agreement with the Company. The Management Services Agreement may be terminated by giving not less than three months’ written notice. During the year the Company was charged $300,000 (2021: $300,000) to Princebrook Pty Ltd for management services. ◊ (c) The appointment of Don Grantham Jr may be terminated by giving not less than three months’ written notice. Don Grantham Jr. was appointed as President & CEO - Eden Innovations LLC during the year, this table includes all remuneration paid during the year to Don Grantham Jr. ◊ (d) Roger Marmaro left employment at Eden in November 2020. 18 Annual Report 2022ASX Code: EDE Number of Options Held by Key Management Personnel Balance 30.6.2021 Granted as Compen- sation Options Exercised Net Change Other* Balance 30.6.2022 Total Vested 30.6.2022 Total Exercisable 30.6.2022 Total Unexer- cisable 30.6.2022 Gregory Solomon Douglas Solomon Lazaros Nikeas Stephen Dunmead - - - - Don Grantham Jr 1,000,000 Aaron Gates - Total 1,000,000 - - - - - - - - - - - - - - 4,962,276 4,962,276 4,962,276 4,962,276 4,259,709 4,259,709 4,259,709 4,259,709 - - - - - - - - - - 1,000,000 1,000,000 1,000,000 - - - 9,221,985 10,221,985 10,221,985 10,221,985 - - - - - - - * Net Change Other refers to options that have been purchased, sold, lapsed or issued during the year. Number of Performance Rights held by Key Management Personnel Balance 30.6.2021 Received as Compensation Lapsed Cancelled Balance 30.6.2022 Gregory Solomon Douglas Solomon Lazaros Nikeas Stephen Dunmead Don Grantham Jr Aaron Gates Total - - - - - 1,800,000 1,800,000 - - - - - - - Number of Shares held by Key Management Personnel - - - - - - - - - - - - (1,800,000) (1,800,000) - - - - - - - Balance 30.6.2021 Received as Compensation Options Exercised Net Change Other* Balance 30.6.2022 Gregory Solomon Douglas Solomon Lazaros Nikeas Stephen Dunmead Don Grantham Jr Aaron Gates 45,369,342 38,945,878 2,920,760 3,920,760 5,000,000 192,500 Total 96,349,240 - - 1,376,574 1,376,574 5,000,000 1,200,000 8,953,148 - - - - - - - 9,924,549 8,519,414 - - - - 55,293,891 47,465,292 4,297,334 5,297,334 10,000,000 1,392,500 18,443,963 123,746,351 * Net Change Other refers to shares purchased or sold during the financial year.Unissued shares under options At the date of this report, the unissued ordinary shares of Eden Innovations Ltd under option are as follows: 19 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE DIRECTORS’ REPORT (Continued) Issue Date Various 20 December 2019 2 December 2020 Various 10 June 2022 Date of Expiry 11 December 2022 19 December 2022 1 December 2023 7 October 2024 28 April 2025 Exercise Price Number under Option $0.05 $0.065 $0.04379 $0.05 $0.026 49,543,744 1,000,000 6,850,762 111,869,645 77,270,989 246,535,140 No person entitled to exercise the option has any right by virtue of the option to participate in any share issue of any other body corporate. At the date of this report there was no unissued shares of the Group under performance rights (2021: 27,304,014). Rounding of amounts Eden Innovations Ltd is a type of Company referred to in ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191 and therefore the amounts contained in this report and in the financial report have been rounded to the nearest $1. Signed in accordance with a resolution of the Board of Directors. __________________________________ Gregory H Solomon Executive Chairman Dated this 30 day of August 2022 Indemnifying Officers The Company has arranged for an insurance policy to insure the directors against liabilities for costs and expenses incurred by them in defending any legal proceedings arising out of their conduct while acting in the capacity of director of the Company, other than conduct involving a wilful breach of duty in relation to the Company. The total premium payable was approximately $84,400. Proceedings on Behalf of Company No person has applied for leave of Court to bring proceedings on behalf of the Company or intervene in any proceedings to which the Company is a party for the purpose of taking responsibility on behalf of the Company for all or any part of those proceedings. The Company was not a party to any such proceedings during the year. Non-audit Services No fees for non-audit services were paid or are payable to the external auditors during the year ended 30 June 2022. Auditor’s Independence Declaration The lead auditor’s independence declaration for the year ended 30 June 2022 has been received and can be found on page 21. 20 Annual Report 2022ASX Code: EDE Lead auditor’s independence declaration under section 307C of the Corporations Act 2001 To the directors of Eden Innovations Ltd I declare that, to the best of my knowledge and belief, in relation to the audit for the financial year ended 30 June 2022 there have been: (i) no contraventions of the auditor’s independence requirements as set out in the Corporations Act 2001 in relation to the audit; and (ii) no contraventions of any applicable code of professional conduct in relation to the audit. Nexia Perth Audit Services Pty Ltd M. Janse Van Nieuwenhuizen|Director Perth 30 August 2022 21 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR YEAR ENDED 30 JUNE 2022 Revenue Other income Changes in inventories Raw materials and consumables used Depreciation and amortisation expense Employee benefits expense Finance costs Legal and consultants Management fees Other financial items Other expenses Travel and accommodation Loss before income tax Income tax (expense)/benefit Loss for the year Other Comprehensive Income / (Loss) Items that may be reclassified subsequently to profit or loss Foreign currency translation reserve Income tax relating to comprehensive income Total Other Comprehensive Income / (Loss), net of tax Total Comprehensive Income / (Loss) attributable to members of the parent Note Consolidated Group 2 3 2022 $ 2021 $ 4,149,161 3,282,822 853,001 615,244 7,380 1,211,995 (1,938,975) (2,159,214) (1,410,079) (1,278,892) 4a (4,772,216) (4,156,472) 5 8 (744,676) (695,895) (300,000) 22,531 (2,086,013) (338,660) (747,810) (614,303) (300,000) 105,115 (946,245) (163,135) (6,646,577) (5,758,759) - - (6,646,577) (5,758,759) 812,360 (890,420) 812,360 (890,420) - (5,834,217) (6,649,179) Basic/Diluted loss per share (cents per share) 7 (0.2952) (0.2912) The accompanying notes form part of these financial statements. 22 Annual Report 2022ASX Code: EDE CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2022 ASSETS CURRENT ASSETS Cash and cash equivalents Trade and other receivables Inventories Other current assets TOTAL CURRENT ASSETS NON-CURRENT ASSETS Property, plant and equipment Intangible assets TOTAL NON-CURRENT ASSETS TOTAL ASSETS CURRENT LIABILITIES Trade and other payables Interest bearing liabilities Other liabilities Provisions TOTAL CURRENT LIABILITIES NON-CURRENT LIABILITIES Interest bearing liabilities Other liabilities TOTAL NON-CURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Issued capital Reserves Accumulated losses TOTAL EQUITY The accompanying notes form part of these financial statements. Note Consolidated Group 2022 $ 2021 $ 10 11 12 13 14 15 16 15 17 21 1,553,106 2,175,637 730,479 568,709 2,563,345 1,840,582 188,309 163,083 5,035,239 4,748,011 10,764,137 10,607,478 9,987,272 9,123,044 20,751,409 19,730,522 25,786,648 24,478,533 949,665 755,188 4,911,084 4,771,126 116,194 217,544 135,639 171,341 6,194,487 5,833,294 - 107,082 107,082 486,143 18,364 504,507 6,301,569 6,337,801 19,485,079 18,140,732 121,603,612 114,736,287 9,943,493 8,819,894 (112,062,026) (105,415,449) 19,485,079 18,140,732 23 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR YEAR ENDED 30 JUNE 2022 Fully Paid Ordinary Shares Share based payment Reserve Consolidated Group Foreign Currency Translation Reserve $ $ $ $ $ Accumulated Losses Total Balance at 30 June 2020 Shares issued during the year, net of issue costs Share based payments during the year Loss for year Other comprehensive income Total comprehensive income/(loss) Balance at 30 June 2021 Shares issued during the year, net of issue costs Share based payments during the year Loss for year Other comprehensive income Total comprehensive income/(loss) Balance at 30 June 2022 105,503,776 8,584,158 1,301,268 (99,656,690) 15,732,512 9,232,511 - - - - - (175,112) - - - - - - - - 9,232,511 (175,112) (5,758,759) (5,758,759) (890,420) - (890,420) (890,420) (5,758,759) (6,649,179) 114,736,287 8,409,046 410,848 (105,415,449) 18,140,732 6,867,325 - - - - - 311,239 - - - - - - - - 6,867,325 311,239 (6,646,577) (6,646,577) 812,360 - 812,360 812,360 (6,646,577) 5,834,217 121,603,612 8,720,285 1,223,208 (112,062,026) 19,485,079 The accompanying notes form part of these financial statements. 24 Annual Report 2022ASX Code: EDE CONSOLIDATED STATEMENT OF CASH FLOWS FOR YEAR ENDED 30 JUNE 2022 CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers and employees Income taxes (paid)/received Interest paid Interest received Net cash used in operating activities CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property, plant and equipment Payment for research and development Net cash used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of shares, net of issue costs Proceeds from borrowings, net of borrowing costs Repayment of borrowings Net cash provided by financing activities Net increase/(decrease) in cash held Net increase/(decrease) due to foreign exchange movements Cash at beginning of financial year Cash at end of financial year The accompanying notes form part of these financial statements. Note Consolidated Group 2021 $ 2022 $ 19 12 13 4,246,679 3,184,141 (9,914,151) (8,293,187) - - (371,362) (444,289) 4,423 5,808 (6,034,411) (5,547,527) (36,552) (459,981) (1,443,116) (1,449,268) (1,479,668) (1,909,249) 5,725,650 8,823,011 1,170,711 - (120,600) (372,555) 6,775,761 8,450,456 (738,318) 993,680 115,787 (206,726) 2,175,637 1,388,683 10 1,553,106 2,175,637 25 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2022 NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES The financial report is a general purpose financial report that has been prepared in accordance with Australian Accounting Standards, other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001. The financial report complies with all International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board in their entirety. The financial report covers the consolidated Group of Eden Innovations Ltd and its controlled entities as at and for the year ended 30 June 2022. Eden Innovations Ltd is a listed public company, incorporated and domiciled in Australia. The Group is a for-profit entity and primarily is involved in clean technology solutions. The financial report was authorised for issue on 30 August 2022 by the Board of Directors. The following is a summary of the material accounting policies adopted by the consolidated Group in the preparation of the financial report. The accounting policies have been consistently applied, unless otherwise stated. The continuing applicability of the going concern basis of accounting is dependent upon the Group’s ability to source additional finance. Unless additional finance is received the Group may need to realise assets and settle liabilities other than in the normal course of business and at amounts which could differ from the amounts at which they are stated in these financial statements. Accounting Policies a. Principles of Consolidation A controlled entity is any entity Eden Innovations Ltd is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. A list of controlled entities is contained in Note 22 to the financial statements. All controlled entities have a June year-end. All inter-company balances and transactions between entities in the consolidated group, including any unrealised profits or losses, have been eliminated on consolidation. Accounting policies of subsidiaries have been changed where necessary to ensure consistencies with those policies applied by the parent entity. Basis of Preparation b. Income Tax The accounting policies set out below have been consistently applied to all years presented. Reporting Basis and Conventions The financial report has been prepared on an accruals basis and is based on historical costs modified by the revaluation of selected non-current assets, financial assets and financial liabilities for which the fair value basis of accounting has been applied. These consolidated financial statements are presented in Australian dollars, which is the parent’s functional currency. The subsidiaries’ functional currencies are USD and INR. Going Concern These financial statements have been prepared on a going concern basis, which contemplates continuity of normal business activities and the realisation of assets and extinguishment of liabilities in the ordinary course of business. The Group has reported a net loss for the year of $6,646,577 (2021: $5,758,759) and a cash outflow from operating activities of $6,034,411 (2021: $5,547,527). The directors are confident that the Group, subject to being able to raise further capital or debt funding, will be able to continue its operations as a going concern. Without such capital and or funding, the net loss for the year and the cash outflow from operating activities indicate the existence of a material uncertainty which may cast significant doubt about the Group’s ability to continue as a going concern. 26 The charge for current income tax expense is based on the profit for the year adjusted for any non-assessable or disallowed items. It is calculated using the tax rates that have been enacted or are substantially enacted by the balance sheet date. Deferred tax is accounted for using the balance sheet liability method in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a business combination, where there is no effect on accounting or taxable profit or loss. Deferred income tax assets are recognised to the extent that it is probable that future tax profits will be available against which deductible temporary differences can be utilised. Eden Innovations Ltd, Eden Innovations Holdings Pty Ltd and Eden Energy Holdings Pty Ltd, its wholly-owned Australian subsidiaries, have formed an income tax consolidated group under the tax consolidation regime. The Group notified the Australian Tax Office that it had formed an income tax consolidated group to apply from 1 July 2005. The tax consolidated group has entered a tax sharing agreement whereby each company in the group contributes to the income tax payable in proportion to their contribution to the net profit before tax of the tax consolidated group. The R&D tax rebate is recognised as income tax benefit upon receipt. Annual Report 2022ASX Code: EDE Class of Fixed Asset Depreciation Rate Plant and equipment 6 – 33% straight line Buildings Land 4% straight line Nil Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are included in the statement of profit or loss and other comprehensive income. When revalued assets are sold, amounts included in the revaluation reserve relating to that asset are transferred to retained earnings. h. Financial Instruments Initial recognition and measurement Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual provisions of the financial instrument. Financial assets are initially measured at fair value adjusted for transaction costs. Classification and subsequent measurement For the purpose of subsequent measurement, financial assets are classified into the following categories: ◊ amortised cost ◊ fair value through profit or loss (FVTPL) ◊ equity instruments at fair value through other comprehensive income (FVOCI) ◊ debt instruments at fair value through other comprehensive income (FVOCI). All income and expenses relating to financial assets that are recognised in profit or loss are presented within finance costs, finance income or other financial items. The classification is determined by both the entity’s business model for managing the financial asset and the contractual cash flow characteristics of the financial asset. c. Inventories Inventories are measured at the lower of cost and net realisable value. The cost of manufactured products includes direct materials, direct labour and an appropriate portion of variable and fixed overheads. Costs are assigned on the basis of first-in, first-out. d. Segment reporting Segment results that are reported to the Group’s board of directors (the chief operating decision maker) include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. e. Employee Benefits Provision is made for the Company’s liability for employee benefits arising from services rendered by employees to balance date. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability is settled, plus related on-costs. f. Revenue Revenue is recognised when or as the Group transfers control of products or provides services to a customer at the amount to which the Group expects to be entitled as the performance obligation is met. If the consideration includes a variable component, the expected consideration is adjusted for the estimated impact of the variable component at the point of recognition and re-estimated at every reporting period. Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets. g. Property, Plant and Equipment Each class of property, plant and equipment is carried at cost less, where applicable, any accumulated depreciation and impairment losses. Property, plant and equipment are initially recognised at acquisition cost or manufacturing cost, including any costs directly attributable to bringing the assets to the location and condition necessary for it to be capable of operating in the manner intended by the Group’s management. The carrying amount of property, plant and equipment is reviewed annually by directors to ensure it is not in excess of the recoverable amount of these assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be received from the asset’s employment and subsequent disposal. The expected net cash flows have been discounted to their present values in determining recoverable amounts. The depreciation rates used for each class of depreciable assets are: 27 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2022 (Continued) Financial assets are measured at amortised cost if the assets meet the following conditions (and are not designated as FVTPL): ◊ they are held within a business model whose objective is to hold the financial assets to collect its contractual cash flows ◊ the contractual terms of the financial assets give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding. After initial recognition, these are measured at a mortised cost using the effective interest method. Discounting is omitted where the effect of discounting is immaterial. The entity’s cash and cash equivalents, trade and most other receivables fall into this category of financial instruments. Trade and other receivables The entity makes use of a simplified approach in accounting for trade and other receivables and records the loss allowance as lifetime expected credit losses. These are the expected shortfalls in contractual cash flows, considering the potential for default at any point during the life of the financial instrument. In calculating, the entity uses its historical experience, external indicators and forward-looking information to calculate the expected credit losses. Classification and measurement of financial liabilities The entity’s financial liabilities include trade and other payables and borrowings. Financial liabilities are initially measured at fair value, and, where applicable, adjusted for transaction costs. Subsequently, financial liabilities are measured at amortised cost using the effective interest method. All interest-related charges and, if applicable, changes in an instrument’s fair value that are reported in profit or loss are included within finance costs or finance income. Derecognition Financial assets are derecognised when the contractual rights to the cash flows from the financial asset expire, or when the financial asset and substantially all the risks and rewards are transferred. A financial liability is derecognised when it is extinguished, discharged, cancelled or expires. Impairment The Group recognises an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value through profit or loss. i. Impairment of Assets At each reporting date, the Group reviews the carrying values of its tangible and intangible assets to determine whether there is any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in use, is compared to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable amount is expensed to the statement of profit or loss and other comprehensive income. Impairment testing is performed annually for goodwill and intangible assets with indefinite lives. Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.. j. Intangibles Research and development Expenditure during the research phase of a project is recognised as an expense when incurred. Development costs are capitalised only when technical feasibility studies identify that the project will deliver future economic benefits and these benefits can be measured reliably. Development costs have a finite life and are amortised on a systematic basis matched to the future economic benefits over the useful life of the project. Intellectual Property Intellectual property, which includes trademarks and engineering knowledge, is included in the financial statements at cost. Intellectual property and trademarks are only amortised or written down where the useful lives are limited or impaired by specific circumstances, in such cases amortisation is charged on a straight line basis over their useful lives and write downs are charged fully when incurred. The directors have assessed the useful life of the intellectual property and have determined that it has a finite useful life of 10 to 20 years. The intellectual property is amortised on a systematic basis matched to the expected future economic benefits over the useful life of the project. 28 Annual Report 2022ASX Code: EDE k. Foreign Currency Transactions and Balances m. Comparative Figures Functional and presentation currency The functional currency of each of the group’s entities is measured using the currency of the primary economic environment in which that entity operates. The consolidated financial statements are presented in Australian dollars which is the parent entity’s functional and presentation currency. Transaction and balances Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non- monetary items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined. Exchange differences arising on the translation of monetary items are recognised in the statement of profit or loss and other comprehensive income. Group companies The financial results and position of foreign operations whose functional currency is different from the Group’s presentation currency are translated as follows: ◊ assets and liabilities are translated at year-end exchange rates prevailing at that reporting date; ◊ income and expenses are translated at average exchange rates for the financial year; and ◊ retained earnings are translated at the exchange rates prevailing at the date of the transaction. Exchange differences arising on translation of foreign operations are transferred directly to the Group’s foreign currency translation reserve in the balance sheet. These differences are recognised in the statement of profit or loss and other comprehensive income in the period in which the operation is disposed. Intercompany loans are treated as investments for foreign currency translation purposes. l. Equity-settled compensation The Group operates an employee share option plan and performance rights plan. The total amount to be expensed over the vesting period is determined by reference to the fair value of the options or performance rights granted. When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year. n. Ordinary shares Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares are recognised as a deduction from equity. o. New accounting standards and interpretations New and amended standards adopted by the Group The Group has adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board (the AASB) that are relevant to its operations and effective for the current year. The new and revised Standards and amendments thereof and Interpretations do not have any material impact on the disclosures or on the amounts recognised in the Group’s condensed consolidated financial statements. Critical Accounting Estimates and Judgments The directors evaluate estimates and judgments incorporated into the financial report based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the Group. Key Estimates — Impairment The Group assesses impairment of finite intangible assets and property, plant & equipment at each reporting date by evaluating conditions specific to the Group that may lead to impairment of assets. At the date of this report the Group has sufficient reason to believe that the Group’s intangible assets and property, plant & equipment are not impaired. There is a significant risk of actual outcomes being different from those forecasted due to changes in economic or market conditions and events. Key Estimates — Share-based payment transactions The consolidated entity measures the cost of equity settled transactions with suppliers and employees by reference to the fair value of the equity instruments as at the date at which they are granted. The fair value is determined using a Black-Scholes model. Refer to Note 4b for the inputs to the Black-Scholes model. 29 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2022 (Continued) NOTE 2: REVENUE Operating activities - - EdenCrete® sales OptiBlend® sales and services Total revenue NOTE 3: OTHER INCOME Debt forgiveness Interest Total other income NOTE 4: EMPLOYEE BENEFITS a. Employee benefits expense Expenses recognised for employee benefits are analysed below: Short-term employee benefits Post-employment benefits Share based payments Total b. Share-based Employee Remuneration 2022 $ 2021 $ 1,599,707 2,549,454 4,149,161 1,754,921 1,527,901 3,282,822 2022 $ 849,521 3,480 853,001 2021 $ - 7,380 7,380 2022 $ 2021 $ (4,025,488) (4,034,107) (197,473) (549,255) (200,385) 78,020 (4,772,216) (4,156,472) Included under employee benefits expense in the statement of profit or loss and other comprehensive income is $549,255 (2021: credit $78,020) which relates, in full, to equity settled share-based payment transactions. Nil relates to options (2021: Nil), $549,255 relates to shares (2021: $231,216) and Nil relates to performance rights (2021: credit $309,236). Options All options granted to personnel are over ordinary shares in Eden Innovations Ltd, which confer a right of one ordinary share for every option held. When issued, the shares carry full dividend and voting rights. 30 Annual Report 2022ASX Code: EDE 2022 2021 Number of Options Weighted Average Exercise Price $ Number of Options Weighted Average Exercise Price $ 1,000,000 0.065 1,330,000 - - - 1,000,000 1,000,000 - - - 0.065 0.065 - - (330,000) 1,000,000 1,000,000 0.111 - - 0.25 0.065 0.065 Outstanding at the beginning of the year Granted Exercised Cancelled/lapsed Outstanding at year-end Exercisable at year-end The options outstanding at 30 June 2022 had a weighted average exercise price of $0.065 and a weighted average remaining contractual life of 0.5 years. No options were exercised during the year ended 30 June 2022. Historical volatility has been the basis used for determining expected share price volatility as it is assumed that this is indicative of future tender, which may not eventuate. Volatility of 82-109% and a risk free rate of 0.88-2.24% were used in the Black-Scholes models. The life of the options is based on the historical exercise patterns, which may not eventuate in the future. Performance rights During the year, 23,303,013 performance rights were cancelled and shares were issued in consideration. Each grant comprised 3 classes. Class A vests upon commercial revenue reaching US$6 million over a rolling 12 month period before 31 August 2022, Class B vests upon commercial revenue reaching US$12 million over a rolling 12 month period before 31 August 2023 and Class C vests upon commercial revenue reaching US$24 million over a rolling 12 month period before 31 August 2024. Outstanding at the beginning of the year Cancelled Granted Exercised or Lapsed Outstanding at year-end Number of Performance Rights 2022 Number of Performance Rights 2021 27,304,014 (23,303,013) - (4,001,001) - 26,391,012 (19,481,010) 27,304,014 (6,910,002) 27,304,014 31 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2022 (Continued) NOTE 5: OTHER FINANCIAL ITEMS Foreign exchange gain / (loss) Total NOTE 6: AUDITORS’ REMUNERATION Remuneration of the auditor of the parent entity for: — auditing or reviewing the financial report — other services Remuneration of other auditors of subsidiaries for: — auditing or reviewing the financial report — other services NOTE 7: EARNINGS PER SHARE (EPS) Basic/ Diluted loss per share (cents per shares) a. Reconciliation of earnings to profit or loss Profit/(loss) Earnings used to calculate basic EPS 2022 $ 22,531 22,531 2021 $ 105,115 105,115 43,425 - 75,086 - - 32,294 - 73,183 - (0.2952) (0.2912) (6,646,577) (5,758,759) (6,646,577) (5,758,759) b. Weighted average number of ordinary shares outstanding during the year used in calculating basic EPS 2,251,292,551 1,977,324,724 The options on issue are not potentially dilutive shares. 32 Annual Report 2022ASX Code: EDE NOTE 8: INCOME TAX BENEFIT a. The prima facie tax on loss from ordinary activities before income tax is reconciled to the income tax as follows: Prima facie tax payable on loss from ordinary activities before income tax at 26% (2021: 26%) Add tax effect of: — — Non-deductible expenses Current year tax losses not recognised Less tax effect of: — — Difference in overseas tax rates Current year temporary differences not recognised Income tax expense/(benefit) b. Components of deferred tax — — — — — — Unrecognised deferred tax asset – losses Property, Plant & Equipment Capital raising costs Share based payments Provisions and accruals Intangibles Total unrecognised deferred tax asset 2022 $ 2021 $ (1,728,110) (1,497,277) 46,363 41,056 1,504,843 1,252,411 176,904 - - 250,097 (46,287) - 31,754,646 28,354,679 (1,144,693) (1,128,637) 158,850 543,207 126,978 159,666 453,228 61,146 (3,083,473) (2,371,991) 28,355,514 25,528,091 Deferred tax assets have not been brought to account as it is not probable within the immediate future that tax profits will be available against which deductible temporary differences and tax losses can be utilised. The benefit of the tax losses will only be obtained if the Group complies with conditions imposed by the relevant tax legislation. NOTE 9: RELATED PARTY TRANSACTIONS Transactions between related parties are on normal commercial terms and conditions no more favourable than those available to other parties unless otherwise stated. Full details of key management personnel remuneration can be found in the remuneration report on page 16. Key Management Personnel Management fees paid/payable to Princebrook Pty Ltd, a company in which Mr GH Solomon and Mr DH Solomon have an interest. At year end, $75,000 was payable (2021: $25,000). Legal fees paid to Solomon Brothers, a firm in which Mr GH Solomon and Mr DH Solomon are partners. At year end, nil was payable (2021: $833). 2022 $ 2021 $ 300,000 300,000 32,957 39,210 33 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2022 (Continued) NOTE 10: CASH AND CASH EQUIVALENTS Cash at bank and in hand Reconciliation of cash Cash at the end of the financial year as shown in the statement of cash flows is reconciled to the consolidated statement of financial position as follows: 2022 $ 1,553,106 1,553,106 2021 $ 2,175,637 2,175,637 1,553,106 1,553,106 2,175,637 2,175,637 2022 $ 2,563,345 2,563,345 2021 $ 1,840,582 1,840,582 Land and buildings Plant and equipment $ $ Total $ 6,537,410 - - 596,897 7,134,307 (842,260) (218,822) - (88,633) (1,149,715) 5,984,592 7,313,264 207,651 (164,261) 561,864 7,918,518 13,850,674 207,651 (164,261) 1,158,761 15,052,825 (2,400,936) (3,243,196) (609,134) 116,389 (245,291) (3,138,972) 4,779,546 (827,956) 116,389 (333,924) (4,288,687) 10,764,138 Cash and cash equivalents NOTE 11: INVENTORIES At cost NOTE 12: PROPERTY, PLANT AND EQUIPMENT Cost Balance 1 July 2021 Additions Disposals Net exchange differences Balance 30 June 2022 Depreciation and impairment Balance 1 July 2021 Depreciation Disposals Net exchange differences Balance 30 June 2022 Carrying amount at 30 June 2022 34 Annual Report 2022ASX Code: EDE NOTE 12: PROPERTY, PLANT AND EQUIPMENT CONTINUED Cost Balance 1 July 2020 Additions Disposals Net exchange differences Balance 30 June 2021 Depreciation and impairment Balance 1 July 2020 Depreciation Disposals Net exchange differences Balance 30 June 2020 Carrying amount at 30 June 2021 Land and buildings $ Plant and equipment $ Total $ 6,913,717 7,892,250 14,805,967 213,955 241,808 455,763 - (148,052) (148,052) (590,262) 6,537,410 (672,742) (1,263,004) 7,313,264 13,850,674 (693,500) (2,113,045) (2,806,545) (209,227) (574,093) (783,320) - 60,467 106,599 179,603 106,599 240,070 (842,260) (2,400,936) (3,243,196) 5,695,150 4,912,328 10,607,478 Capitalised costs amounting to $1,443,116 (2021: $1,449,268) have been included in cash flows from investing activities in the statement of cash flows for the Consolidated Group. NOTE 13: INTANGIBLE ASSETS Intellectual property Accumulated amortisation Accumulated impairment expenses Net carrying value Balance at the beginning of the year Additions Amortisation expense Carrying amount at the end of the year 2022 $ 2021 $ 22,229,577 20,745,226 (2,813,785) (2,193,662) (9,428,520) (9,428,520) 9,987,272 9,123,044 9,123,044 1,484,352 (620,124) 9,987,272 8,223,113 1,432,678 (532,747) 9,123,044 Capitalised costs amounting to $36,552 (2021: $459,981) have been included in cash flows from investing activities in the statement of cash flows for the Consolidated Group. NOTE 14: TRADE AND OTHER PAYABLES Trade payables and other payables 2022 $ 949,665 949,665 2021 $ 755,189 755,189 35 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2022 (Continued) NOTE 15: INTEREST BEARING LIABILITIES Dumont Way property purchase loan (2nd mortgage over the Dumont Way property, 4% interest rate, denominated in USD and 0.3 years remaining) SBA Loan (Unsecured, 1% interest rate, denominated in USD) SnowPoint Loan (Secured over all 3 properties, 11% interest rate, denominated in USD) Total current portion Dumont Way property purchase loan (2nd mortgage over the Dumont Way property, 6% interest rate, denominated in USD and 0.3 years remaining) Total non-current portion Total Opening Balance Proceeds from borrowing, net of borrowing costs Repayment of borrowings Borrowing costs expensed Loan forgiveness* FX (gain) / loss Closing balance * - Non-cash transaction NOTE 16: PROVISIONS Provisions for staff entitlements and warranties 2022 $ 530,530 2021 $ - 39,090 843,708 4,341,464 3,927,418 4,911,084 4,771,126 - - 486,143 486,143 4,911,084 5,257,269 5,257,269 5,998,005 231,137 139,347 (231,137) (371,922) 131,845 (849,521) 371,491 4,911,084 190,291 - (698,452) 5,257,269 2022 $ 217,544 217,544 2021 $ 171,341 171,341 36 Annual Report 2022ASX Code: EDE NOTE 17: ISSUED CAPITAL a. Ordinary shares 2022 No. 2021 No. 2022 $ 2021 $ At the beginning of reporting period 2,082,852,348 1,723,596,366 114,736,287 105,503,776 Shares issued during the year 402,600,647 359,255,982 6,867,325 9,232,511 At reporting date 2,485,452,995 2,082,852,348 121,603,612 114,736,287 i. ii. The ordinary shares on issue have no par value and there is no limited amount of authorised share capital. Ordinary shares participate in dividends and in the proceeds on winding up of the parent entity in proportion to the number of shares held. At the shareholders meetings each ordinary share is entitled to one vote when a poll is called, otherwise each shareholder has one vote on a show of hands. b. Options At the beginning of reporting period Options issued Options exercised Options lapsed At reporting date 2022 No. 2021 No. 69,394,506 83,029,634 189,172,832 68,394,506 (32,198) (157,735) (12,000,000) (81,871,899) 246,535,140 69,394,506 For information relating to the Eden Innovations Ltd employee option plan, refer to Note 4b Share-based Payments. c. Performance rights At the beginning of reporting period Performance rights cancelled Performance rights issued Performance rights exercised or lapsed At reporting date 2022 No. 2021 No. 27,304,014 26,391,012 (23,303,013) (16,481,010] - 27,304,014 (4,001,001) (9,910,002) - 27,304,014 For information relating to performance rights granted to directors and employees, refer to Note 4b Share-based Payments. d. Capital Management Management controls the working capital of the Group in order to maximise the return to shareholders and ensure that the Group can fund its operations and continue as a going concern. Management effectively manages the Group’s capital by assessing the Group’s financial risks and adjusting its capital structure in response to changes in these risks and in the market. These responses include the management of expenditure and share issues. There have been no changes in the strategy adopted by management to control the capital of the Group since the prior year. 37 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2022 (Continued) NOTE 18: CONTINGENT LIABILITIES AND CONTINGENT ASSETS The Directors are not aware of any contingent assets or contingent liabilities at 30 June 2022. NOTE 19: CASH FLOW INFORMATION Reconciliation of Cash Flow from Operations with Loss after Income Tax Loss after income tax Non-cash flows in loss Depreciation and amortisation Share-based payments expense Other financial items Financing costs expensed Assets written off Net exchange differences Changes in assets and liabilities (Increase)/decrease in trade and other receivables (Increase)/decrease in inventories (Increase)/decrease in other current assets Increase/(decrease) in trade payables and accruals* Increase/(decrease) in provisions Increase/(decrease) in other liabilities Cash flow from operations * - Net of non-operating movements NOTE 20: CAPITAL AND LEASING COMMITMENTS a. Capital Expenditure Commitments — not later than 12 months — greater than 12 months b. Other Commitments 2022 $ 2021 $ (6,646,577) (5,758,759) 1,410,079 1,278,892 549,255 (849,521) 200,027 41,453 (50,603) (78,020) - 190,290 32,424 225,790 (161,770) (172,343) (722,763) (1,138,801) (25,226) 194,477 46,203 (19,445) (64,999) (26,586) (8,972) (26,443) (6,034,411) (5,547,527) 2022 $ 2020 $ - - - - - - The Group had commitments over the next 12 months of approximately $20,000 relating to low-value short-term leases. NOTE 21: RESERVES a. Share-based Payment Reserve The share-based payment reserve records items recognised as expenses on valuation of share options and performance rights. Refer to Note 4B for further details of share options and performance rights issued. b. Foreign Currency Translation Reserve The foreign currency translation reserve records exchange differences arising on the translation of foreign subsidiaries. 38 Annual Report 2022ASX Code: EDE Country of Percentage Owned (%)* Incorporation India Australia USA USA 2022 100 100 100 100 2021 100 100 100 100 NOTE 22: CONTROLLED ENTITIES a. Controlled Entities Eden Innovations (India) Pvt Ltd Eden Energy Holdings Pty Ltd Eden Innovations LLC EdenCrete Industries Inc. * Percentage of voting power is in proportion to ownership b. c. Acquisition of Controlled Entities No entities were acquired during the year. Disposal of Controlled Entities No entities were wound up during the year. NOTE 23: PARENT COMPANY INFORMATION a. Parent Entity Assets Current assets Non-current assets (includes loans to and investment in subsidiaries of $6,135,713)* Total Assets Liabilities Current liabilities Total liabilities Net Assets Equity Issued Capital Retained Earnings Share-based payment reserve Total Equity Financial performance Profit / (Loss) for the year* Other comprehensive income, net of tax Total comprehensive income / (Loss) 2022 $ 2021 $ 449,514 483,289 19,411,436 17,851,475 19,860,950 18,334,764 375,870 375,870 194,032 194,032 19,485,090 18,410,743 121,603,612 114,736,287 (110,834,067) (104,999,850) 8,715,545 8,404,306 19,485,090 18,140,743 (5,834,217) (6,649,178) - - (5,834,217) (6,649,178) * - The loans to and investment in subsidiaries have been assessed for impairment and an impairment expense of $3,073,857 (2021: $4,347,658) has been recognised. It is anticipated that the balance of these loans to and investment in subsidiaries will be recovered through the successful commercialisation of EdenCrete® and OptiBlend® by the subsidiary companies. 39 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2021 (Continued) NOTE 24: EVENTS AFTER THE BALANCE SHEET DATE On 26 July 2022 6,400,000 fully paid ordinary shares were issued to Mr Stephen Dunmead and Mr Lazaros Nikeas pursuant to resolutions passed at the general meeting held on 2 July 2019. On 2 August 2022 the board of directors resolved to sell the 65-acre industrial property in Augusta, Georgia. On 10 August 2022 Eden US, support by Eden Australia, finalised a transaction replacing the two earlier secured loans (totalling US$3.365 million) secured against Eden’s US real estate assets, with a new secured loan from iBorrow REIT LP of US$6.475 million, which represents less than 55% of the recently re-appraised values of Eden’s three US properties. The new loan carries an interest rate of 9.75% p.a. The new loan is for 11 months (to 29 June 2023) and with an extension option to 29 June 2024. After repaying the two existing secured loans, payment of all expenses and commissions, and establishing reserves to cover future interest payments, real estate taxes and insurance, approximately US$1.7 million (A$2.45million) of additional working capital for Eden was generated by this transaction, supplementing the revenue stream being received from increasing product sales. On 12 August 2022 the Company issued 94,375,000 EDE shares and 94,375,000 free attaching EDEOC options to investors at $0.008 per share raising $755,000 before costs. Brokers were paid a 6% placement fee and received 7,000,000 EDEOC options. There were no other material events occurring after the reporting date. 40 Annual Report 2022ASX Code: EDE NOTE 25: SEGMENT REPORTING The Group has identified its operating segments based on internal reports that are reviewed and used by the Board of Directors (chief operating decision maker) in assessing performance and determining allocation of resources. Activities of the Group are managed on Group structure basis and operating segments are therefore determined on the same basis. In this regard the following list of reportable segments has been identified. ◊ Eden Innovations LLC – EdenCrete® sales and development and Optiblend® sales, service and manufacturing. ◊ Eden Innovations (India) Pvt Ltd – Optiblend® sales, service and manufacturing in India. Eden Innovations LLC Eden Innovations India Pvt Ltd Eliminations Consolidated Entity $ $ $ $ 2,983,015 53,332 3,036,347 (3,733,698) 1,166,146 - 1,166,146 668,767 (53,332) (53,332) (146,147) - 4,149,161 2022 External sales Internal sales Total segment revenue Segment Result Unallocated expenses Result from operating activities Finance costs Loss before income tax Income tax benefit Loss after income tax Segment assets Unallocated assets Total assets Segment liabilities Unallocated liabilities Total liabilities Capital expenditure Depreciation and amortisation Impairment expense 13,727,174 1,622,688 (9,598) 5,834,022 233,009 - 104,361 789,956 - 1,107 - - 1,484,352 620,123 - - 4,149,161 (3,211,068) (2,690,833) (5,901,901) (744,676) (6,646,577) - (6,646,577) 15,340,264 10,446,384 25,786,648 6,067,031 234,537 6,301,568 1,589,820 1,410,079 - 41 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2022 (Continued) NOTE 25: SEGMENT REPORTING (CONTINUED) 2021 External sales Internal sales Total segment revenue Segment Result Unallocated expenses Result from operating activities Finance costs Loss before income tax Income tax benefit Loss after income tax Segment assets Unallocated assets Total assets Segment liabilities Unallocated liabilities Total liabilities Capital expenditure Depreciation and amortisation Impairment expense Eden Innovations LLC Eden Innovations India Pvt Ltd Eliminations Consolidated Entity $ $ $ $ 2,236,127 1,046,695 - 3,282,822 7,749 2,243,876 (3,312,621) - 1,046,695 680,342 (7,749) (7,749) (139,678) 13,922,062 950,139 6,027,806 239,960 - - 453,577 745,179 - 2,186 966 - 1,432,678 532,747 - - 3,282,822 (2,771,957) (2,238,992) (5,010,949) (747,810) (5,758,759) - (5,758,759) 14,872,201 9,606,332 24,478,533 6,267,766 70,035 6,337,801 1,888,441 1,278,892 - 42 Annual Report 2022ASX Code: EDE NOTE 26: FINANCIAL INSTRUMENTS a. Financial Risk Exposures and Management The main risks the Group is exposed to through its financial instruments are liquidity risk and credit risk. i. Liquidity Risk The Group manages liquidity risk by monitoring forecast cash flows and ensuring that adequate funding is maintained. The remaining contractual maturities of the Group financial liabilities are: 12 months or less 1 year or more Total ii. Credit risk 2022 $ 2021 $ 5,860,749 5,528,616 - 496,556 5,860,749 6,025,172 Credit risk refers to the risk that the counterparty will default on its contractual obligations resulting in a financial loss to the company. The Group has adopted a policy of only dealing with credit worthy counterparties and obtaining sufficient collateral or other security where appropriate, as a means of mitigating the risk of financial loss from defaults. The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date to recognised financial assets, is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the balance sheet and notes to the financial statements. The Group does not have any material credit risk exposure to any single receivable or group of receivables under financial instruments entered into by the company. iii. Foreign currency risk The Group is exposed to fluctuations in foreign currencies arising from the sale and purchase of goods and services in currencies other than the companies’ functional currency. The risk is measure using sensitivity analysis and cash flow forecasting. At 30 June 2022, the effect on the loss and equity as a result of a 10% increase in the exchange rates, with all other variables remaining constant would be a decrease in loss by approximately $400,000 (2021: decrease of loss of $420,000) and a decrease in equity by approximately $530,000 (2021: $440,000). A 10% decrease in the exchange rates would result in an equal and opposite impact on the loss after tax and equity. iv. Interest rate risk Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The group’s minimal exposure to interest rate risk, the only asset / liability affected by changes in market interest rates is Cash and cash equivalents. The Interest Bearing Liabilities of the Group are all fixed rate and will not fluctuate because of changes in market interest rates. b. Financial Instruments Net Fair Values The aggregate net fair values of financial assets and financial liabilities, at the balance date, are approximated by their carrying values. 43 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE NOTE 27: COMPANY DETAILS The registered office of the company is: Eden Innovations Ltd Level 15 197 St Georges Terrace Perth Western Australia 6000 The principal place of business is: Eden Innovations Ltd Level 15 197 St Georges Terrace Perth Western Australia 6000 44 Annual Report 2022ASX Code: EDE DIRECTORS’ DECLARATION In the opinion of the directors of Eden Innovations Ltd: a. the financial statements and notes set out on pages 22 to 44, and the Remuneration disclosures that are contained in pages 16 to 19 of the Remuneration Report in the Directors’ Report, are in accordance with the Corporations Act 2001, including: ◊ giving a true and fair view of the Group’s financial position as at 30 June 2022 and of its performance, for the financial year ended on that date; and ◊ complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Corporations Regulations 2001; and ◊ complying with International Financial Reporting Standards as disclosed in Note 1. b. the remuneration disclosures that are contained in pages 16 to 19 of the Remuneration Report in the Directors’ Report comply with Australian Accounting Standard AASB 124 Related Party Disclosures and c. there are reasonable grounds to believe that the Group will be able to pay its debts as and when they become due and payable. The Directors have been given the declarations required by Section 295A of the Corporations Act 2001 from the Executive Chairman and Chief Financial Officer for the financial year ended 30 June 2022. This declaration is made in accordance with a resolution of the Board of Directors. _________________________________ Gregory H Solomon Executive Chairman Dated this 30th day of August 2022 45 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE Independent Auditor’s Report to the Members of Eden Innovations Limited Report on the Audit of the Financial Report Opinion We have audited the financial report of Eden Innovations Ltd (“the Company”) and its subsidiaries (“the Group"), which comprises the consolidated statement of financial position as at 30 June 2022, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, and the directors’ declaration. In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including: (i) giving a true and fair view of the Group’s financial position as at 30 June 2022 and of its performance for the year then ended; and (ii) complying with Australian Accounting Standards and the Corporations Regulations 2001. Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial report section of our report. We are independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code. We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Material uncertainty relating to going concern Without modifying our opinion, we draw attention to Note 1 of the financial report, which indicates that the Group will require further funding in the next twelve months from the date of this report to fund its planned operating costs. These conditions, along with other matters as set forth in Note 1, indicate the existence of a material uncertainty that may cast significant doubt about the Group’s ability to continue as a going concern and therefore the Group may be unable to realise its assets and discharge its liabilities in the normal course of business. Key audit matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the Material Uncertainty Relating to Going Concern section, we have determined the matter described below to be the key audit matter to be communicated in our report. 46 46 Annual Report 2022ASX Code: EDE Key audit matter How our audit addressed the key audit matter Impairment assessment of Intangible assets and Plant and equipment Refer to Note 11 (Property Plant and Equipment) and Note 12 (Intangible Assets) As at 30 June 2022 the Group’s EdenCrete® and Optiblend® cash generating units (CGUs) comprised Plant and equipment (P&E) and Intangible Assets. The total carrying values of P&E and Intangible Assets as at 30 June 2022 (2021: were, $10,607,478) (2021: $9,123,044). $10,764,137 $9,987,272 respectively, and Impairment was assessed by the Group at the CGU level by considering whether impairment indicators were present as at 30 June 2022. Management determined that there were no such indicators of impairment. The impairment assessment for the Intangible Assets and Plant and equipment is a key audit matter due to: ▪ the significance of the Intangible Assets and Plant and equipment balances the statement of financial position; and to ▪ the judgement involved in the impairment indicator assessment due to the need to make estimates about future events and other circumstances. to evaluate the Group's We performed the following procedures, amongst impairment others, assessment: ▪ assessed management’s determination of the Group’s CGUs based on our understanding of the nature of the Group’s business and the economic environment in which the segments operate. We also analysed the internal reporting of the Group to assess how earnings streams are monitored and reported. ▪ ▪ compared actual sales performance subsequent to year end to forecast sales for the same period. enquired of management and inspected a selection of Board of Directors’ meeting minutes to assess whether there were any: - observable indications that the respective asset values have declined during the year significantly more than would be expected as a result of the passage of time or normal use; or - - significant changes with an adverse effect on the entity that have taken place during the year, or will take place in the near future, in the technological, market, economic or legal environment in which the entity operates or in the market to which an asset is dedicated; or significant changes with an adverse effect on the entity during the year, or any are expected to take place in the near future, in the extent to which, or manner in which, an asset is used or is expected to be used. ▪ We also considered whether: - - there was evidence of obsolescence or physical damage of assets comprising the CGUs; and the market capitalisation of the Group was significantly lower than Eden Innovation’s net assets at balance date. Other information The directors are responsible for the other information. The other information comprises the information in Eden Innovations Limited’s annual report for the year ended 30 June 2022, but does not include the consolidated financial report and the auditor’s report thereon. Our opinion on the consolidated financial report does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the consolidated financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated. 47 47 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE If, based on the work we have performed, we conclude that there is a material misstatement of the other information we are required to report that fact. We have nothing to report in this regard. Directors’ responsibility for the financial report The directors of the Company are responsible for the preparation of the consolidated financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the consolidated financial report, the directors are responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the entity or to cease operations, or have no realistic alternative but to do so. Auditor’s responsibility for the audit of the financial report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: ▪ Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. ▪ Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. ▪ Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. ▪ Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. ▪ Evaluate the overall presentation, structure, and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation. ▪ Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the Group financial report. We are responsible for the direction, supervision, and performance of the Group audit. We remain solely responsible for our audit opinion. 48 48 Annual Report 2022ASX Code: EDE We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied. From the matters communicated with the directors, we determine those matters that were of most significance in the audit of the financial report of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. Report on the Remuneration Report Opinion on the Remuneration Report We have audited the Remuneration Report included in pages 16 to 20 of the Directors’ Report for the year ended 30 June 2022. In our opinion, the Remuneration Report of Eden Innovations Limited for the year ended 30 June 2022, complies with Section 300A of the Corporations Act 2001. Responsibilities The directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance with Section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. Nexia Perth Audit Services Pty Ltd M. Janse Van Nieuwenhuizen Director Perth 30 August 2022 49 49 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES The following additional information is required by the Australian Securities Exchange Ltd. 1. Shareholding as at 15 August 2022 a. Distribution of Shareholders Category (size of holding) 1 – 1,000 1,001 – 5,000 5,001 – 10,000 10,001 – 100,000 100,001 – and over b. c. The number of shareholdings held in less than marketable parcels is 4,054. The names of the substantial shareholders listed in the holding company’s register as at 15 August 2022 are: Shareholder Noble Energy Pty Ltd d. Voting Rights Number Ordinary % Issued Capital 239 675 643 3,024 2,378 6,959 0.00% 0.09% 0.20% 5.04% 94.68% 100% Number Ordinary 770,100,784 The voting rights attached to each class of equity security are as follows: Ordinary shares - Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a meeting or by proxy has one vote on a show of hands. e. 20 Largest Shareholders — Ordinary Shares Name Citicorp Nominees Pty Ltd Noble Energy Pty Ltd Noble Energy Pty Ltd Arkenstone Pty Ltd 1. 2. 3. 4. Mr & Mrs Rogerson & Miss C Rogerson 5. March Bells Pty Ltd 6. Mr Wayne Kearney & Mrs Robyn Kearney 7. 8. Mr Stephen Carter 9. March Bells Pty Ltd 10. Kalsie Holdings Pty Ltd 11. Mr Donal O’Sullivan 12. Mr Douglas Solomon 13. G J Holdings Pty Limited 14. Mr Gregory Solomon 15. Miss Michelle Hawksley 16. Mr Evan Clucas & Ms Leanne Weston 17. Paddocks Superannuation Pty Ltd 18. Voyage Super Fund Pty Ltd 19. Mrs Sharyn Farrell 20. Mr Norman Maher 50 Number of Shares 715,420,065 54,680,719 39,928,171 35,304,338 21,659,985 20,810,441 19,406,870 16,000,000 13,500,000 12,608,555 12,500,000 12,197,025 12,178,000 12,000,000 11,893,613 11,804,742 11,260,313 10,475,166 10,000,000 8,497,334 1,062,125,337 % Issued Capital 27.66% 2.11% 1.54% 1.37% 0.84% 0.80% 0.75% 0.62% 0.52% 0.49% 0.48% 0.47% 0.47% 0.46% 0.46% 0.46% 0.44% 0.41% 0.39% 0.33% 41.07% Annual Report 2022ASX Code: EDE ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES e. 20 Largest Optionholders — EDEO Name Noble Energy Pty Ltd Citicorp Nominees Pty Ltd Lemaire Wealth Pty Ltd 1. 2. Mr John Jarvis 3. Mr Frazer McGinn 4. 5. Mr Daniel Tuckett 6. Mr MD Muntasir Billah 7. 8. Mr Ramin Vahdani 9. Matthew Burford Superfund Pty Ltd 10. Aluba Pty Ltd 11. Taylor-Stevenson Corporation Pty Ltd 12. Noble Energy Pty Ltd 13. Mr Malcom Anderson 14. Mr Kevin Leary + Mrs Helen Leary 15. Arkenstone Pty Ltd 16. DVR Invest Pty Ltd 17. Mr Paul Frost 18. Mr Gregory Miller 19. Mrs Svjetlana Bjeljac 20. Mrs Svjetlana Bjeljac + Mr Alis Trakilovic
Number of Shares 24,458,806 16,000,000 4,387,547 4,069,906 3,992,500 2,855,862 2,597,060 2,293,060 2,272,727 2,000,000 2,000,000 1,869,427 1,500,000 1,409,090 1,365,066 1,125,000 1,062,990 1,053,176 1,000,000 1,000,000 78,312,217 % Issued Capital 21.86% 14.30% 3.92% 3.64% 3.57% 2.55% 2.32% 2.05% 2.03% 1.79% 1.79% 1.67% 1.34% 1.26% 1.22% 1.01% 0.95% 0.94% 0.89% 0.89% 70.00% 51 Eden Innovations Limited and Controlled Entities ABN 58 109 200 900Annual Report 2022ASX Code: EDE ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES Number of Shares 39,745,560 15,500,000 10,000,000 7,000,000 6,250,000 6,000,000 5,643,750 5,000,000 5,000,000 5,000,000 3,750,000 3,125,000 3,037,818 3,000,000 3,000,000 2,750,000 2,500,000 2,500,000 2,500,000 2,500,000 133,802,128 % Issued Capital 22.25% 8.68% 5.60% 3.92% 3.50% 3.36% 3.16% 2.80% 2.80% 2.80% 2.1% 1.75% 1.70% 1.68% 1.68% 1.54% 1.40% 1.40% 1.40% 1.40% 74.90% Number on issue 49,543,744 6,850,762 1,000,000 57,394,506 Number of holders 112 1 1 120 e. 20 Largest Optionholders — EDEOC Name Rotherwood Enterprises Pty Ltd Morsec Nominees Pty Ltd Safinia Pty Ltd Noble Energy Pty Ltd Saba Nominees Pty Ltd Yucaja Pty Ltd 180 Markets Pty Ltd 1. 2. 3. 4. 5. Matthew Burford Superfund Pty Ltd 6. 7. 8. 9. Mr Christopher Richards + Mrs Linnet Richards 10. Hirsch Financial Pty Ltd 11. Mr Mark Tkocz 12. ABN Amro Clearing Sydney Nominees Pty Ltd 13. Noble Energy Pty Ltd 14. Riya Investments Pty Ltd 15. North of the River Investments Pty Ltd 16. Comsec Nominees Pty Ltd 17. Blue Heeler Capital Pty Ltd 18. DSL Trading Company Pty Ltd 19. Mr Engleman Chau 20. Pastro Holding Pty Ltd 2. Unquoted Securities – Options as at 15 August 2022 Holder Name Date of Expiry Exercise Price Various LS Whitehall Group Inc Don Grantham Jr 11 December 2022 1 December 2023 19 December 2022 $0.05 $0.04379 $0.065 52 Annual Report 2022ASX Code: EDE Construction of EdenCrete® enriched concrete retaining walls on Central 70 project in Denver, Colorado www.edeninnovations.com